A new regulation closely concerning homeowners and real estate investors was published in the Official Gazette dated August 6, 2026. With the General Communiqué on the Real Estate Tax Law (Series No. 90), jointly prepared by the Ministry of Treasury and Finance and the Ministry of Environment, Urbanization and Climate Change, the normal construction cost values per square meter to be applied in 2027 have been officially determined.
What Is the Purpose of This Regulation?
The normal construction cost values per square meter, updated annually under Real Estate Tax Law No. 1319, play a key role in calculating the following year’s real estate tax base. Municipalities use the cost values specified in this communiqué when determining a building’s taxable value. The calculation basically works as follows:
Building Tax Value = Construction Cost per Square Meter + Land (or Land Share) Value
In other words, the newly published schedule will be one of the main factors determining the real estate tax you will pay in 2027. When either of these two components changes, the resulting tax base also changes automatically. Therefore, both the update in construction cost values and changes in land assessed values need to be considered together.
The annual publication of the communiqué is not accidental; under the law, the ministries are required to revise these values each year by taking current market conditions and changes in construction costs into account. The aim is to prevent the tax base from becoming excessively disconnected from actual construction costs.
What Are the Figures for Residential Buildings?
For residential properties, there is a considerable range depending on the construction class. The minimum and maximum normal construction cost values per square meter for residential buildings are as follows:
| Construction Class | Minimum (TL/m²) | Maximum (TL/m²) |
|---|---|---|
| Luxury construction | 12,642.67 | 27,712.26 |
| First-class construction | 5,335.40 | 18,532.07 |
| Second-class construction | 3,758.56 | 12,555.79 |
| Third-class construction | 1,269.61 | 8,551.49 |
| Simple construction | 604.10 | 3,856.64 |
As the table shows, a residential building being classified as “simple” rather than “luxury” can result in a difference of nearly 45 times in the construction cost per square meter. This means that two homes of the same size can have very different tax bases depending on their construction class.
So who determines which class a building belongs to? The classification is based on technical criteria such as the building’s structural system (steel frame, reinforced concrete frame, masonry, etc.), the quality of materials used, and the building’s overall characteristics and equipment. Municipalities generally make this assessment based on building permits and occupancy records.
The Scope Is Not Limited to Residential Buildings
The communiqué covers a much wider range of structures, not just homes. The schedule sets normal construction costs per square meter separately according to building type, including:
- Steel-frame buildings
- Reinforced-concrete-frame buildings
- Masonry buildings
- Semi-masonry buildings
- Wooden and stone buildings
Each building type is also divided into first-, second- and third-class categories.
The communiqué also provides different cost values according to the intended use of the building. Some of the main building types listed in the schedule are:
- Residential buildings
- Factory and manufacturing buildings
- Hotels
- Cinema and theater buildings
- Bank and insurance buildings
- Administrative buildings
- Maritime station buildings
- Underground and detached garages
- Dormitories and school buildings
- Swimming pools
- Baths and Turkish baths
In other words, from industrial facility owners and hotel operators to school foundations and sports facility operators, a broad range of property owners will be subject to updated cost values specific to their type of building.
Why Does It Change Every Year?
There are several main reasons why construction cost values are revised annually:
- Inflation and input costs: As the prices of construction inputs such as cement, steel and labor change throughout the year, actual construction costs also change.
- Keeping the tax base up to date: If cost values are not updated, the tax base can fall significantly behind actual market values over time.
- Maintaining balance between building types: Cost increases in different sectors such as residential, industrial and tourism construction can develop differently, which is why separate updates are required for each building type.
What Does This Mean in Practice for Homeowners?
This communiqué does not by itself mean that “taxes have increased.” The key factors are the type and class of your building and the current value of the land or land share on which it stands. However, as a general trend, annual updates to construction cost values often indicate an increase in the real estate tax base as well.
Practical recommendations for homeowners and real estate investors include:
- Find out your building’s class. You can ask your municipality’s real estate tax department which construction class your building falls under.
- Monitor the value of your land share. The assessed value of the land or land share, which is the other component of the tax base, is also announced separately by municipalities.
- Do not miss annual notification deadlines. Real estate tax declarations for newly constructed or transferred properties must be submitted within specified periods; delays may result in penalties.
- Exercise your right to object if there is an error. If you believe your building has been placed in the wrong class, you can apply to the relevant municipality and file an objection.
Conclusion
The General Communiqué on the Real Estate Tax Law (Series No. 90), published in the Official Gazette on August 6, 2026, introduced the new normal construction cost values per square meter that will form the basis for calculating real estate tax in 2027 for a wide range of buildings, from homes and factories to hotels and schools. For residential buildings, the values range from TL 604.10 to TL 27,712.26 depending on the construction class, while updated schedules have also been introduced for other types of buildings.
For those who want to find out exactly which class their building falls into and how much tax they may have to pay, the most reliable approach is to contact the real estate tax department of their municipality directly.
